FDIC Law, Regulations, Related Acts

2000 - Rules and Regulations

Subpart ARules of General
Applicability

§ 303.1 Scope.

Subpart A prescribes the general procedures for submitting filings
to the FDIC which are required by statute or regulation. This subpart
also prescribes the procedures to be followed by the FDIC, applicants
and interested parties during the process of considering a filing,
including public notice and comment. This subpart explains the
availability of expedited processing for eligible depository
institutions (defined in § 303.2(r)). Certain terms used throughout
this part are also defined in this subpart.

[Codified to 12 C.F.R. § 303.1]

§ 303.2 Definitions.

Except as modified or otherwise defined in this part, terms used in
this part that are defined in the Federal Deposit Insurance Act (12
U.S.C. 1811 et seq.) have the meanings provided in the Federal Deposit
Insurance Act. Additional definitions of terms used in this part are as
follows:

(b) Adjusted part 325 total assets means adjusted
12 CFR part 325 total assets
as calculated and reflected in the FDIC's Report of Examination.

(c) Adverse comment means any objection, protest, or
other adverse written statement submitted by an interested party
relative to a filing. The term adverse comment shall not include any
comment concerning the Community Reinvestment Act (CRA), fair lending,
consumer protection, or civil rights that the appropriate regional
director or designee determines to be frivolous (for example, raising
issues between the commenter and the applicant that have been
resolved). The term adverse comment also shall not include any other
comment that the appropriate regional director or designee determines
to be frivolous (for example, a non-substantive comment submitted
primarily as a means of delaying action on the filing).

(d) Amended order to pay means an order to forfeit and
pay civil money penalties, the amount of which has been changed from
that assessed in the original notice of assessment of civil money
penalties.

(e) Applicant means a person or entity that submits a
filing to the FDIC.

(f) Application means a submission requesting FDIC
approval to engage in various corporate activities and transactions.

(1) When an institution or proposed institution that is the
subject of a filing or administrative action is not and will not be
part of a group of related institutions, the appropriate FDIC region
for the institution and any individual associated with the institution
is the FDIC region in which the institution or proposed institution is
or will be located, and the appropriate regional director is the
regional director for that region; or

(2) When an institution or proposed institution that is the
subject of a filing or administrative action is or will be part of a
group of related institutions, the appropriate FDIC region for the
institution and any individual associated with the institution is the
FDIC region in which the group's major policy and decision makers are
located, or any other region the FDIC designates on a case-by-case
basis, and the appropriate regional director is the regional director
for that region.

(h) Associate director means any associate director of
the Division of Supervision and Consumer Protection (DSC) or, in the
event such title become obsolete, any official of equivalent authority
within the division.

(i) Book capital means total equity capital which is
comprised of perpetual preferred stock, common stock, surplus,
undivided profits and capital reserves, as those items are defined in
the instructions of the Federal Financial Institutions Examination
Council (FFIEC) for the preparation of Consolidated Reports of
Condition and Income for insured banks.

(j) Comment means any written statement of fact or
opinion submitted by an interested party relative to a filing.

(l) CRA protest means any adverse comment from the
public related to a pending filing which raises a negative issue
relative to the Community Reinvestment Act (CRA) 12 U.S.C. 2901
et seq.), whether or not it is labeled a protest and whether
or not a hearing is requested.

(m) Deputy director means the deputy director of the
Division of Supervision and Consumer Protection (DSC) or, in the event
such title become obsolete, any official of equivalent or higher
authority within the division.

(n) Deputy regional director means any deputy regional
director of the Division of Supervision and Consumer Protection (DSC)
or, in the event such title become obsolete, any official of equivalent
authority within the same FDIC region of DSC.

(p) DSC means the Division of Supervision and Consumer
Protection or, in the event the Division of Supervision and Consumer
Protection is reorganized, such successor division.

(q) Director means the Director of the Division of
Supervision and Consumer Protection (DSC) or, in the event such title
become obsolete, any official of equivalent or higher authority within
the division.

(r) Eligible depository institution means a depository
institution that meets the following criteria:

(1) Received an FDIC-assigned composite rating of 1 or 2 under
the Uniform Financial Institutions Rating System (UFIRS) as a result of
its most recent federal or state examination;

(2) Received a satisfactory or better Community Reinvestment Act
(CRA) rating from its primary federal regulator at its most recent
examination, if the depository institution is subject to examination
under part 345 of this chapter;

(3) Received a compliance rating of 1 or 2 from its primary
federal regulator at its most recent examination;

(4) Is well-capitalized as defined in the appropriate capital
regulation and guidance of the institution's primary federal
regulator; and

(5) Is not subject to a cease and desist order, consent order,
prompt corrective action directive, written agreement, memorandum of
understanding, or other administrative agreement with its primary
federal regulator or chartering authority.

(s) Filing means an application, notice or request
submitted to the FDIC under this part.

(t) General Counsel means the head of the Legal Division
of the FDIC or any official within the Legal Division exercising
equivalent authority for purposes of this part.

(u) Insider means a person who is or is proposed to be a
director, officer, organizer, or incorporator of an applicant; a
shareholder who directly or indirectly controls 10 percent or more of
any class of the applicant's outstanding voting stock; or the
associates or interests of any such person.

(v) Institution-affiliated party shall have the same
meaning as provided in section 3(u) of the Act (12 U.S.C. 1813(u)).

(y) Notice means a submission notifying the FDIC that a
depository institution intends to engage in or has commenced certain
corporate activities or transactions.

(z) Notice to primary regulator means the notice
described in section 8(a)(2)(A) of the Act concerning termination of
deposit insurance (12 U.S.C.
1818(a)(2)(A)).

(aa) Regional counsel means a regional counsel of the
Legal Division or, in the event the title becomes obsolete, any
official of equivalent authority within the Legal Division.

(bb) Regional director means any regional director in
the Division of Supervision and consumer Protection (DSC), or in the
event such title become obsolete, any official of equivalent authority
within the division.

(cc) [Reserved]

(dd) Standard conditions means the conditions that the
FDIC may impose as a routine matter when approving a filing, whether or
not the applicant has agreed to their inclusion. The following
conditions, or variations thereof, are standard conditions:

(1) That the applicant has obtained all necessary and final
approvals from the appropriate federal or state authority or other
appropriate authority;

(2) That if the transaction does not take effect within a
specified time period, or unless, in the meantime, a request for an
extension of time has been approved, the consent granted shall expire
at the end of the specified time period;

(3) That until the conditional commitment of the FDIC becomes
effective, the FDIC retains the right to alter, suspend or withdraw its
commitment should any interim development be deemed to warrant such
action; and

(4) In the case of a merger transaction (as defined in
§ 303.61(a) of this
part), including a corporate reorganization, that the proposed
transaction not be consummated before the 30th calendar day (or shorter
time period as may be prescribed by the FDIC with the concurrence of
the Attorney General) after the date of the order approving the merger
transaction.

(ee) Tier 1 capital shall have the same meaning as
provided in § 325.2(v) of this chapter
(12 CFR 325.2(v)) or
§ 324.2, as applicable.

(ff) Total assets shall have the same meaning as
provided in § 325.2(x) of this chapter (12 CFR 325.2(x)) or
§ 324.401(g), as applicable.

Unless stated otherwise, filings should be submitted to the
appropriate FDIC office. Forms and instructions for submitting filings
may be obtained from any FDIC regional director. If no form is
prescribed, the filing should be in writing; be signed by the applicant
or a duly authorized agent; and contain a concise statement of the
action requested. For specific filing and content requirements, consult
the appropriate subparts of this part. The FDIC may require the
applicant to submit additional information.

[Codified to 12 C.F.R.
§ 303.3]

§ 303.4 Computation of time.

For purposes of this part, and except as otherwise specifically
provided, the FDIC begins computing the relevant period on the day
after an event occurs (e.g., the day after a substantially
complete filing is received by the FDIC or the day after publication
begins) through the last day of the relevant period. When the last day
is a Saturday, Sunday or federal holiday, the period runs until the end
of the next business day.

Among other factors, the FDIC takes into account the record of
performance under the Community Reinvestment Act (CRA) of each
applicant in considering a filing for approval of:

(a) The establishment of a domestic branch;

(b) The relocation of the bank's main office or a domestic branch;

(c) The relocation of an insured branch of a foreign bank;

(d) A transaction subject to the Bank Merger Act; and

(e) Deposit insurance.

[Codified to 12 C.F.R. § 303.5]

§ 303.6 Investigations and examinations.

The FDIC may examine or investigate and evaluate facts related to
any filing under this chapter to the extent necessary to reach an
informed decision and take any action necessary or appropriate under
the circumstances.

[Codified to 12 C.F.R. § 303.6]

§ 303.7 Public notice requirements.

(a) General. The public must be provided with prior
notice of a filing to establish a domestic branch, relocate a domestic
branch or the main office, relocate an insured branch of a foreign
bank, engage in a merger transaction, initiate a change of control
transaction, or request deposit insurance. The public has the right to
comment on, or to protest, these types of proposed transactions during
the relevant comment period. In order to fully apprise the public of
this right, an applicant shall publish a public notice of its filing in
a newspaper of general circulation. For specific publication
requirements, consult subparts
B (Deposit Insurance),
C (Branches and
Relocations), D (Merger
Transactions), E (Change in
Bank Control), and J
(International Banking) of this part.

(b) Confirmation of publication. The applicant shall
mail or otherwise deliver a copy of the newspaper notice to the
appropriate FDIC office as part of its filing, or, if a copy is not
available at the time of filing, promptly after publication.

(c) Content of notice. (1) The public notice referred to
in paragraph (a) of this section shall consist of the following:

(i) Name and address of the applicant(s). In the case
of an application for deposit insurance for a de novo bank, include the
names of all organizers or incorporators. In the case of an application
to establish a branch, include the location of the proposed branch or,
in the case of an application to relocate a branch or main office,
include the current and proposed address of the office. In the case of
a merger application, include the names of all parties to the
transaction. In the case of a notice of acquisition of control, include
the name(s) of the acquiring parties. In the case of an application to
relocate an insured branch of a foreign bank, include the current and
proposed address of the branch.

(ii) Type of filing being made;

(iii) Name of the depository institution(s) that is the subject
matter of the filing;

(iv) That the public may submit comments to the appropriate FDIC
regional director;

(v) The address of the appropriate FDIC office where comments may
be sent (the same location where the filing will be made);

(vi) The closing date of the public comment period as specified
in the appropriate subpart; and

(vii) That the nonconfidential portions of the application are on
file in the appropriate FDIC office and are available for public
inspection during regular business hours; photocopies of the
nonconfidential portion of the application file will be made available
upon request.

(2) The requirements of paragraphs (c)(1)(iv) through (vii) of
this section may be satisfied through use of the following notice:

Any person wishing to comment on this application may file his
or her comments in writing with the regional director of the Federal
Deposit Insurance Corporation at the appropriate FDIC office [insert
address of office] not later than [insert closing date of the public
comment period specified in the appropriate subpart of part 303]. The
nonconfidential portions of the application are on file at the
appropriate FDIC office and are available for public inspection during
regular business hours. Photocopies of the nonconfidential portion of
the application file will be made available upon request.

(d) Multiple transactions. The FDIC may consider
more than one transaction, or a series of transactions, to be a single
filing for purposes of the publication requirements of this section.
When publishing a single public notice for multiple transactions, the
applicant shall explain in the public notice how the transactions are
related. The closing date of the comment period shall be the closing
date of the longest public comment period that applies to any of the
related transactions.

(e) Joint public notices. For a transaction subject to
public notice requirements by the FDIC and another federal or state
banking authority, the FDIC will accept publication of a single joint
notice containing all the information required by both the FDIC and the
other federal agency or state banking authority, provided that the
notice states that comments must be submitted to the appropriate FDIC
office and, if applicable, the other federal or state banking
authority.

(f) Where public notice is required, the FDIC may determine on a
case-by-case basis that unusual circumstances surrounding a particular
filing warrant modification of the publication requirements.

[Codified to 12 C.F.R. § 303.7]

§ 303.8 Public access to filing.

(a) General. For filings subject to a public notice
requirement, any person may inspect or request a copy of the
non-confidential portions of a filing (the public file) until 180 days
following final disposition of a filing. Following the 180-day period,
non-confidential portions of an application file will be made available
in accordance with § 303.8(c). The public file generally consists of
portions of the filing, supporting data, supplementary information, and
comments submitted by interested persons (if any) to the extent that
the documents have not been afforded confidential treatment. To view or
request photocopies of the public file, an oral or written request
should be submitted to the appropriate FDIC office. The public file
will be produced for review not more than one business day after
receipt by the appropriate FDIC office of the request (either written
or oral) to see the file. The FDIC may impose a fee for photocopying in
accordance with
§ 309.5(f) of this
chapter at the rates the FDIC publishes annually in the Federal
Register.

(b) Confidential treatment. (1) The applicant may
request that specific information be treated as confidential. The
following information generally is considered confidential:

(i) Personal information, the release of which would constitute a
clearly unwarranted invasion of privacy;

(ii) Commercial or financial information, the disclosure of which
could result in substantial competitive harm to the submitter; and

(iii) Information, the disclosure of which could seriously affect
the financial condition of any depository institution.

(2) If an applicant requests confidential treatment for
information that the FDIC does not consider to be confidential, the
FDIC may include that information in the public file after notifying
the applicant. On its own initiative, the FDIC may determine that
certain information should be treated as confidential and withhold that
information from the public file.

(c) FOIA requests. A written request for information
withheld from the public file, or copies of the public file following
closure of the file 180 days after final disposition, should be
submitted pursuant to the Freedom of Information Act (5 U.S.C. 552) and
part 309 of this chapter to
the FDIC, Attn: FOIA/Privacy Group, Legal Division, 550 17th Street,
NW., Washington, DC 20429.

[Codified to 12 C.F.R. § 303.8]

§ 303.9 Comments.

(a) Submission of comments. For filings subject to a
public notice requirement, any person may submit comments to the
appropriate FDIC regional director during the comment period.

(b) Comment period--(1) General. Consult
appropriate subparts of this part for the comment period applicable to
a particular filing.

(2) Extension. The FDIC may extend or reopen the
comment period if:

(i) The applicant fails to file all required information on a
timely basis to permit review by the public or makes a request for
confidential treatment not granted by the FDIC that delays the public
availability of that information;

(ii) Any person requesting an extension of time satisfactorily
demonstrates to the FDIC that additional time is necessary to develop
factual information that the FDIC determines may materially affect the
application; or

(iii) The FDIC determines that other good cause
exists.

(3) Solicitation of comments. Whenever appropriate,
the appropriate regional director may solicit comments from any person
or institution which might have an interest in or be affected by the
pending filing.

(4) Applicant response. The FDIC will provide copies
of all comments received to the applicant and may give the applicant an
opportunity to respond.

[Codified to 12 C.F.R. § 303.9]

§ 303.10 Hearings and other meetings.

(a) Matters covered. This section covers hearings and
other proceedings in connection with filings and determinations for or
by:

(1) Deposit insurance by a proposed new depository institution or
operating non-insured institution;

(2) An insured state nonmember bank to establish a domestic
branch or to relocate a main office or domestic branch;

(ii) Except as otherwise expressly provided, the provisions of
this § 303.10 shall not be applicable to any proposed merger
transaction which the FDIC Board of Directors determines must be acted
upon immediately to prevent the probable failure of one of the
institutions involved, or must be handled with expeditious action due
to an existing emergency condition, as permitted by the Bank Merger Act
(12 U.S.C. 1828(c)(6));

(5) Nullification of a decision on a filing; and

(6) Any other purpose or matter which the FDIC Board of Directors
in its sole discretion deems appropriate.

(b) Hearing requests. (1) Any person may submit a
written request for a hearing on a filing:

(i) To the appropriate regional director before the end of the
comment period; or

(ii) To the appropriate regional director, pursuant to a notice
to nullify a decision on a filing issued pursuant to
§ 303.11(g)(2)(i) or (ii).

(2) The request must describe the nature of the issues or facts
to be presented and the reasons why written submissions would be
insufficient to make an adequate presentation of those issues or facts
to the FDIC. A person requesting a hearing shall simultaneously submit
a copy of the request to the applicant.

(c) Action on a hearing request. The appropriate
regional director, after consultation with the Legal Division, may
grant or deny a request for a hearing and may limit the issues that he
or she deems relevant or material. The FDIC generally grants a hearing
request only if it determines that written submissions would be
insufficient or that a hearing otherwise would be in the public
interest.

(d) Denial of a hearing request. If the appropriate
regional director, after consultation with the Legal Division, denies a
hearing request, he or she shall notify the person requesting the
hearing of the reason for the denial. A decision to deny a hearing
request shall be a final agency determination and is not appealable.

(e) FDIC procedures prior to the
hearing--(1) Notice of hearing. The FDIC shall issue a
notice of hearing if it grants a request for a hearing or orders a
hearing because it is in the public interest. The notice of hearing
shall state the subject and date of the filing, the time and place of
the hearing, and the issues to be addressed. The FDIC shall send a copy
of the notice of hearing to the applicant, to the person requesting the
hearing, and to anyone else requesting a copy.

(2) The presiding officer shall be the regional director or
designee or such other person as may be named by the Board or the
Director. The presiding officer is responsible for conducting the
hearing and determining all procedural questions not governed by this
section.

(f) Participation in the hearing. Any person who wishes
to appear (participant) shall notify the appropriate regional director
of his or her intent to participate in the hearing no later than 10
days from the date that the FDIC issues the Notice of Hearing. At least
5 days before the hearing, each participant shall submit to the
appropriate regional director, as well as to the applicant and any
other person as required by the FDIC, the names of witnesses, a
statement describing the proposed testimony of each witness, and one
copy of each exhibit the participant intends to present.

(g) Transcripts. The FDIC shall arrange for a hearing
transcript. The person requesting the hearing and the applicant each
shall bear the cost of one copy of the transcript for his or her use
unless such cost is waived by the presiding officer and incurred by the
FDIC.

(h) Conduct of the hearing--(1) Presentations.
Subject to the rulings of the presiding officer, the applicant and
participants may make opening and closing statements and present and
examine witnesses, material, and data.

(2) Information submitted. Any person presenting
material shall furnish one copy to the FDIC, one copy to the applicant,
and one copy to each participant.

(i) Closing the hearing record. At the applicant's or
any participant's request, or at the FDIC's discretion, the FDIC may
keep the hearing record open for up to 10 days following the FDIC's
receipt of the transcript. The FDIC shall resume processing the filing
after the record closes.

(j) Disposition and notice thereof. The presiding
officer shall make a recommendation to the FDIC within 20 days
following the date the hearing and record on the proceeding are closed.
The FDIC shall notify the applicant and all participants of the final
disposition of a filing and shall provide a statement of the reasons
for the final disposition.

(k) Computation of time. In computing periods of time
under this section, the provisions of § 308.12 of the FDIC's Rules
of Practice and Procedure (12 CFR
308.12) shall apply.

(l) Informal proceedings. The FDIC may arrange for an
informal proceeding with an applicant and other interested parties in
connection with a filing, either upon receipt of a written request for
such a meeting made during the comment period, or upon the FDIC's own
initiative. No later than 10 days prior to an informal proceeding, the
appropriate regional director shall notify the applicant and each
person who requested a hearing or oral presentation of the date, time,
and place of the proceeding. The proceeding may assume any form,
including a meeting with FDIC representatives at which participants
will be asked to present their views orally. The regional director may
hold separate meetings with each of the participants.

(m) Authority retained by FDIC Board of Directors to modify
procedures. The FDIC Board of Directors may delegate authority by
resolution on a case-by-case basis to the presiding officer to adopt
different procedures in individual matters and on such terms and
conditions as the Board of Directors determines in its discretion. The
resolution shall be made available for public inspection and copying in
the Office of the General Counsel, Executive Secretary Section under
the Freedom of Information Act (5 U.S.C. 552(a)(2)).

[Codified to 12 C.F.R. § 303.10]

§ 303.11 Decisions.

(a) General procedures. The FDIC may approve,
conditionally approve, deny, or not object to a filing after
appropriate review and consideration of the record. The FDIC will
promptly notify the applicant and any person who makes a written
request of the final disposition of a filing. If the FDIC denies a
filing, the FDIC will immediately notify the applicant in writing of
the reasons for the denial.

(b) Authority retained by FDIC Board of Directors to modify
procedures. In acting on any filing under this part, the FDIC
Board of Directors may by resolution adopt procedures which differ from
those contained in this part when it deems it necessary or in the
public
interest to do so. The
resolution shall be made available for public inspection and copying in
the Office of the General Counsel, Executive Secretary Section under
the Freedom of Information Act (5 U.S.C. 552(a)(2)).

(c) Expedited processing. (1) A filing submitted by an
eligible depository institution as defined in § 303.2(r) will receive
expedited processing as specified in the appropriate subparts of this
part unless the FDIC determines to remove the filing from expedited
processing for any of the reasons set forth in paragraph (c)(2) of this
section. Except for filings made pursuant to subpart J (International
Banking), expedited processing will not be available for any filing
that the appropriate regional director does not have delegated
authority to approve.

(2) Removal of filing from expedited processing. The
FDIC may remove a filing from expedited processing at any time prior to
final disposition if:

(i) For filings subject to public notice under § 303.7, an
adverse comment is received that warrants additional investigation or
review;

(ii) For filings subject to evaluation of CRA performance under
§ 303.5, a CRA protest is received that warrants additional
investigation or review, or the appropriate regional director
determines that the filing presents a significant CRA or compliance
concern;

(iii) For any filing, the appropriate regional director
determines that the filing presents a significant supervisory concern,
or raises a significant legal or policy issue; or

(iv) For any filing, the appropriate regional director determines
that other good cause exists for removal.

(3) For purposes of this section, a significant CRA concern
includes, but is not limited to, a determination by the appropriate
regional director that, although a depository institution may have an
institution-wide rating of satisfactory or better, a depository
institution's CRA rating is less than satisfactory in a state or
multi-state metropolitan statistical area, or a depository
institution's CRA performance is less than satisfactory in a
metropolitan statistical area as defined in
12 CFR 345.12 (MSA) or in
the non-MSA portion of a state in which it seeks to expand through
approval of an application for a deposit facility as defined in 12
U.S.C. 2902(3).

(4) If the FDIC determines that it is necessary to remove a
filing from expedited processing pursuant to paragraph (c)(2) of this
section, the FDIC promptly will provide the applicant with a written
explanation.

(d) Multiple transactions. If the FDIC is considering
related transactions, some or all of which have been granted expedited
processing, then the longest processing time for any of the related
transactions shall govern for purposes of approval.

(e) Abandonment of filing. A filing must contain all
information set forth in the applicable subpart of this part. To the
extent necessary to evaluate a filing, the FDIC may require an
applicant to provide additional information. If information requested
by the FDIC is not provided within the time period specified by the
agency, the FDIC may deem the filing abandoned and shall provide
written notification to the applicant and any interested parties that
submitted comments to the FDIC that the file has been closed.

(f) Appeals and requests for reconsideration--(1)
General. Appeal procedures for a denial of a change in bank
control (subpart E), change in senior executive officer or board of
directors (subpart F) or denial of an application pursuant to section
19 of the FDI Act (subpart L) are contained in
12 CFR part 308, subparts D,
L, and M, respectively. For all other filings covered by this chapter
for which appeal procedures are not provided by regulation or other
written guidance, the procedures specified in paragraphs (f)(2) and (3)
of this section shall apply. A decision to deny a request for a hearing
is a final agency determination and is not appealable.

(2) Filing procedures. Within 15 days of receipt of
notice from the FDIC that its filing has been denied, any applicant may
file a request for reconsideration with the appropriate regional
director.

(3) Content of filing. A request for reconsideration
must contain the following information:

(i) A resolution of the board of directors of the applicant
authorizing filing of the request if the applicant is a corporation, or
a letter signed by the individual(s) filing the request if the
applicant is not a corporation;

(ii) Relevant, substantive information that for good cause was
not previously set forth in the filing; and

(6) Processing. The FDIC will notify the applicant
whether reconsideration will be granted or denied within 15 days of
receipt of a request for reconsideration. If a request for
reconsideration is granted pursuant to § 303.11(f), the FDIC will
notify the applicant of the final agency decision on such filing within
60 days of its receipt of the request for reconsideration.

(g) Nullification, withdrawal, revocation, amendment, and
suspension of decisions on filings--(1) Grounds for action.
Except as otherwise provided by law or regulation, the FDIC may
nullify, withdraw, revoke, amend or suspend a decision on a filing if
it becomes aware at anytime:

(i) Of any material misrepresentation or omission related to the
filing or of any material change in circumstance that occurred prior to
the consummation of the transaction or commencement of the activity
authorized by the decision on the filing; or

(ii) That the decision on the filing is contrary to law or
regulation or was granted due to clerical or administrative error.

(iii) Any person responsible for a material misrepresentation or
omission in a filing or supporting materials may be subject to an
enforcement action and other penalties, including criminal penalties
provided in Title 18 of the United States Code.

(2) Notice of intent and temporary order. (i) Except
as provided in § 303.11(g)(2)(ii), before taking action under this
§ 303.11(g), the FDIC shall issue and serve on an applicant written
notice of its intent to take such action. A notice of intent to act on
a filing shall include:

(A) The reasons for the proposed action; and

(B) The date by which the applicant may file a written response
with the FDIC.

(ii) The FDIC may issue a temporary order on a decision on a
filing without providing an applicant a prior notice of intent if the
FDIC determines that:

(A) It is necessary to reevaluate the impact of a change in
circumstance prior to the consummation of the transaction or
commencement of the activity authorized by the decision on the filing;
or

(B) The activity authorized by the filing may pose a threat to
the interests of the depository institution's depositors or may
threaten to impair public confidence in the depository institution.

(iii) A temporary order shall provide the applicant with an
opportunity to make a written response in accordance with
§ 303.11(g)(3) of this section.

(3) Response to notice of intent or temporary order.
An applicant may file a written response to a notice of intent or
a temporary order within 15 days from the date of service of the notice
or temporary order. The written response should include:

(i) An explanation of why the proposed action or temporary order
is not warranted; and

(ii)(A) Any other relevant information, mitigating circumstance,
documentation, or other evidence in support of the applicant's
position. An applicant may also request a hearing under § 303.10.

(B) Failure by an applicant to file a written response with the
FDIC to a notice of intent or a temporary order within the specified
time period, shall constitute a waiver of the opportunity to respond
and shall constitute consent to a final order under this paragraph (g).
The FDIC shall consider any such response, if filed in a timely manner,
within 30 days of receiving the response.

(a) The Board of Directors, of the FDIC (Board) may, for good cause
and to the extent permitted by statute, waiver the applicability of any
provision of this chapter.

(b) The provisions of this chapter may be suspended, revoked,
amended or waived for good cause shown, in whole or in part, at any
time by the Board, subject to the provisions of the Administrative
Procedure Act and the provisions of this chapter. Any provision of the
rules may be waived by the Board on its own motion or on petition if
good cause thereof is shown.

§ 303.14 Being "engaged in the business of receiving
deposits other than trust funds."

(a) Except as provided in paragraphs (b), (c), and (d) of this
section, a depository institution shall be "engaged in the business
of receiving deposits other than trust funds" only if it maintains
one or more non-trust deposit accounts in the minimum aggregate amount
of $500,000.

(b) An applicant for federal deposit insurance under section 5 of
the FDI Act, 12 U.S.C. 1815(a),
shall be deemed to be "engaged in the business of receiving deposits
other than trust funds" from the date that the FDIC approves deposit
insurance for the institution until one year after it opens for
business.

(c) Any depository institution that fails to satisfy the minimum
deposit standard specified in paragraph (a) of this section as of two
consecutive call report dates (i.e., March 31st, June 30th,
September 30th, and December 31st) shall be subject to a determination
by the FDIC that the institution is not "engaged in the business of
receiving deposits other than trust funds" and to termination of its
insured status under section 8(p) of the FDI Act,
12 U.S.C. 1818(p). For purposes
of this paragraph, the first three call report dates after the
institution opens for business are excluded.

(d) Notwithstanding any failure by an insured depository
institution to satisfy the minimum deposit standard in paragraph (a) of
this section, the institution shall continue to be "engaged in the
business of receiving deposits other than trust funds" for purposes
of section 3 of the FDI Act until the institution's insured status is
terminated by the FDIC pursuant to a proceeding under section 8(a) or
section 8(p) of the FDI Act, 12 U.S.C.
1818(a) or 1818(p).

(a) For purposes of the definition of "State bank" in 12
U.S.C. 1813(a)(2) and this Chapter, a banking institution that is
chartered as a limited liability company (LLC) under the law of any
State is deemed to be "incorporated" under the law of the State,
if

(1) The institution is not subject to automatic termination,
dissolution, or suspension upon the happening of some event (including,
e.g., the death, disability, bankruptcy, expulsion, or
withdrawal of an owner of the institution), other than the passage of
time;

(2) The exclusive authority to manage the institution is vested
in a board of managers or directors that is elected or appointed by the
owners, and that operates in substantially the same manner as, and has
substantially the same rights, powers, privileges, duties,
responsibilities, as a board of directors of a bank chartered as a
corporation in the State;

(3) Neither State law, nor the institution's operating agreement
bylaws, or other organizational documents provide that an owner of the
institution is liable for the debts, liabilities, and obligations of
the institution in excess of the amount of the owner's investment; and

(4) Neither State law, nor the institution's operating
agreement, bylaws, or other organizational documents require the
consent of any other owner of the institution in order for an owner to
transfer an ownership interest in the institution, including voting
rights.

(b) For purposes of the Federal Deposit Insurance Act and this
Chapter,

(1) Each of the terms "stockholder" and "shareholder"
includes an owner of any interest in a bank chartered as an LLC,
including a member or participant;

(2) The term "director" includes a manager or director of a
bank chartered as an LLC, or other person who has, with respect to such
a bank, authority substantially similar to that of a director of a
corporation;

(3) The term "officer" includes an officer of a bank
chartered as an LLC, or other person who has, with respect to such a
bank, authority substantially similar to that of an officer of a
corporation; and

(4) Each of the terms "voting stock," "voting
shares," and "voting securities" includes ownership interests
in a bank chartered as an LLC, as well as any certificates or other
evidence of such ownership interests.